Dro

Pippalab

Hi
I am new to the forum and would like advice please.
Like many others I am at my wits end worrying about my debts. I am fully maxed out on credit cards for £18500 but I also have £7000 outstanding on my Amex charge card. As you know the charge card has to be settled in full every month but a couple of months ago I had to hold my hands up and advised Amex the problem. As I have held the card for over 20 years they proposed a payment plan to help pay the debt off in due course which I have started paying. However I am now in a situation where I can’t pay the minimum on my credit cards and a friend suggested I look into a DRO which I admit I did not know about. I fit the criteria for the balance of my credit card debts as they are under the £20,000 limit. My question is would I be able to get approval for the DRO on my credit cards and leave the payment plan with Amex to run separately or would the £7000 owed to Amex have to be added bringing the total over the £20,000 limit and therefore the DRO would not be approved?
Any help or guidance would be really appreciated as I don’t know which way to turn.

sourcrates

Hi,

I fear you will fail with the amount of debt you have.

Debts that are excluded from DRO include:

• All student loans (old and new style)
• Magistrates' court fines
• Debts to the child maintenance service or CSA
• Social fund loans
• Criminal fines (including debt incurred under the Proceeds of Crime Act)
• Claims against you for damage or personal injury
• TV Licence arrears

I think charge cards are counted as credit cards, confirm it with stepchange, but i believe that is the case.


Any reason why Bankruptcy has not been considered ?

Pippalab

Hi
Thanks for the reply. I haven’t looked into bankruptcy yet.
I just wondered that as I have already established a payment plan with Amex whether Amex might turn around and say “we have a payment plan with you so will not become part of a DRO.”
Obviously with the payment plan they will eventually get their money whereas the DRO will not benefit them at all.

ToxtethO'Grady

You're over the £20K limit doesn't matter if you have a plan with them, they're a provable debt and not excluded. A credit check would be requested by your intermediary and it would show up, they'd advise you not to go for a DRO as it would get rejected and you cannot apply for another 6 years.

BR or an IVA/DMP might be your better option, speak to one of the free impartial debt organisations, Stepchange/National Debtline/ Citizens Advice to get their take after doing your income and expenditure.

The money you are using towards the charge card could be shared out amongst the rest on an IVA or DMP